Turkey

Turkey-New Commercial Code

The second draft of the new Turkish Commercial Code (hereinafter "NTCC") is currently under review and the new code may be in force by January 2007. Some important issues of the new draft in relation to maritime and insurance law may be worth attention.

a) Carriers' liability‧It is added that Carriers should be responsible, inter alia, for losses arising out of delay. This seems to be in line with the Hamburg Rules while apart from Hague-Visby Rules.

• With regards to the exceptions of carriers' liability, it seems that the Hague-Visby Rules approach is adopted
• In light of a new rule, If losses arising out of several causes and some falls under the exceptions, the amount of claim will be calculated pro rata.
• SDR is introduced in presenting the unit / package limitation

b) Counter security for arresting ships

At the present regime, a bank letter of guarantee up to 15% or even 20% will be required by the Court in order to arrest a vessel. Under the new code, counter guarantee would be fixed amount of Euro 10,000. And upon application of the opponent party, and subject to the consideration of the Court, the amount of counter security can be increased in accordance with factors such as TC rate.

c) Acceptance of Club Letters of Undertaking

Another improvement within the NTCC is the acceptance of Club Letters of Undertaking, however this is conditional on the opposing party accepting the Letter of Undertaking and the Court being informed of such agreement. This would certainly help to avoid the problems under the current regime where only a bank letter of guarantee is acceptable by the court in deciding arrest/ release of a vessel.

d) Cancellation of charter - compensation of losses

The NTCC has a different approach concerning the cancellation of charter. The owners have to prove their losses arising out of an unjustified cancellation of the charter; if there are difficulties determining the loss, the Court may calculate the compensation as 30% of the total freight.